Shares of this Miniratna stock jumped around 7 percent in Friday’s trading session after the company signed a contract with the Ministry of Defence (MoD) worth Rs 329 crores. In the past month, the company’s stock has gained more than 25 percent.
With a market capitalization of Rs 12,863.99 crores, the stocks of BEML Limited opened their trading hour on Friday at Rs 2,946.50 and closed at Rs 3,089, gaining approximately 7 percent as compared to the previous closing levels of Rs 2888.60 apiece.
Such sharp movements were observed after the company successfully signed a contract with the Ministry of Defence (MoD) worth Rs 329 crores for the procurement of Mechanical Minefield Marking Equipment (MMME) II.
The equipment has been designed for the purpose of operating cross country with a complete load of stores and carrying out marking of minefields with minimal manpower employment and time.
The Ministry of Defence, in its release, said that the Minefield Marking Equipment will be produced with equipment and sub-systems that are sourced from indigenous manufacturers thereby boosting the indigenous manufacturing and participation private sector in defence production.
During the recent financial quarters, the company’s operating revenues as well as after-tax profits took a positive shift with the former moving up from Rs 576.91 crores during Q1FY23-24 to Rs 916.79 crores during Q2FY23-24, and, the latter, during the same period, transitioned from a loss of Rs 75.01 crores to a profit of Rs 51.78 crores.
In addition to the above metrics, the profitability ratios of the company went up with the return on equity (RoE) rising from 5.63 percent during FY21-22 to 6.61 percent during FY22-23 and the return on capital employed (RoCE) taking a shift from 8.91 percent to 11.21 percent.
As per the recent presentations, the company reported an upward shift in the “mining & construction” and “rail & metro” segment with the former shifting from 33 percent of the revenue mix during Q2FY23 to 43 percent of the revenue mix during Q2FY24, and, the latter, during the same period, rising from 29 percent to 41 percent.
Incorporated in 1964, BEML Limited is a company based in India that operates through three broad segments, viz, mining & construction, rail & metro, and defence segment. Some of the products offered by the company include hydraulic excavators, bulldozers, dump trucks, motor graders, wheel loaders and dozers, powerline systems, etc.
Written by Amit Madnani
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